The U.S. services sector expanded more rapidly than economists expected in December as new orders picked up, the Institute for Supply Management reported Wednesday.

ISM’s non-manufacturing business activity composite index rose to 57.1 on a seasonally adjusted basis, from 55.0 in November. Economists polled by Thomson Reuters had expected a 55.5 level.

Readings below 50 signal a slowing economy. Higher ones signal expansion.

“The index has also increased for four straight months, indicating that growth in the non-manufacturing sectors of the economy has accelerated,” Steven Wood, chief economist at Insight Economics, said in a research note. “A cyclical upswing is currently in place that should, if continued, be fast enough to create a moderate number of new jobs, make a dent in a too-high unemployment rate, and help generate some traction for a self-sustaining economic expansion.”

The prices-paid component index, closely watched for signs of inflation, jumped to 70.0 from 63.2; employment fell to 50.5 from 52.7; production rose to 63.5 from 57.0; and new orders climbed to 63.0 from 57.7.

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